Kaneka Malaysia and BACRE Break Ground on Biomass Steam Plant in Gebeng Industrial Estate

• Aims to supply up to 30 tonnes per hour of renewable steam, scheduled to begin operations in Q3 2026
• Expected to reduce Kaneka’s greenhouse gas emissions by approximately 30,000 tCO₂e annually

Kaneka (Malaysia) Sdn Bhd and BAC Renewable Energy Sdn Bhd (BACRE) marked the start of construction for a USD 7 million biomass steam plant in Gebeng, Pahang, on 12 September 2025. Developed under a 20-year Steam Supply and Purchase Agreement, the facility will replace natural gas–fired steam generation at Kaneka Malaysia’s chemical industrial complex, supplying up to 30 tonnes per hour of green steam. This initiative supports Kaneka Malaysia’s target to reduce greenhouse gas emissions by 70% by 2030 and its broader commitment to achieve net-zero emissions by 2050.

[1 MYR = 0.237919 USD]

BACRE Gebeng Sdn Bhd will serve as the project developer, owner, and operator, while Knight Frank Project Services Sdn Bhd has been appointed as turnkey contractor. Boilermech Sdn Bhd will provide boiler technology and system integration. Financial support comes from Bank Islam Malaysia Berhad, and Emnes Metal Sdn Bhd will facilitate cross-sector coordination.

Kaneka Malaysia’s Managing Director, Hiroyuki Nishimoto, said: “This green steam initiative reflects our commitment to sustainability and innovation. Working with BACRE and its consortium of partners allows us to significantly reduce our carbon footprint by about 30,000 tCO₂e per year while enhancing operational efficiency. This is also a breakthrough for Kaneka Corporation, Japan, by having its first biomass steam plant here in Kaneka Malaysia.”

The 3.4-acre plant will feature fuel flexibility—utilising empty fruit bunches, palm kernel shells, and woodchips—alongside advanced combustion, heat recovery systems, automated ash handling, and stringent emission controls to comply with Department of Environment regulations. BACRE Director Hasnoel Ramly commented: “This project reflects BACRE’s mission to turn palm waste into a reliable and sustainable energy resource. We are building and operating this facility with a vision to set a benchmark for industrial decarbonisation in Malaysia.”

The plant is projected to avoid 24,240 tCO₂ emissions annually through steam substitution, with an additional 70,032 tCO₂ reduction over ten years by preventing methane and nitrous oxide release from decomposing biomass. Once operational in Q3 2026, it will support national agendas under the Renewable Energy Roadmap and the National Energy Transition Roadmap by converting agricultural waste into clean energy, reducing industrial emissions, and reinforcing circular economy principles.

This project complements BACRE’s broader regional biofuel strategy, including a memorandum of agreement signed earlier in 2025 with TLP Terminal to develop a BioLNG storage and export hub at Tanjung Langsat Port.